What are the appropriate forms to file when using a mega-backdoor?
In order to take advantage of the tax benefits, investors need to report the mega backdoor Roth IRA conversion properly. When doing this conversion, there are two forms to look out for: Form 1099-R and Form 5498.
What tax form do I use for Mega Backdoor Roth?
Form 1099-R
Mega Backdoor Roth Tax Reporting
Form 1099-R: tells investors how much was taken out of a retirement account. The form alone designates a distribution that would be taxable if investors don’t put the funds into another qualified plan. Form 5498: is sent when investors convert the funds and fund the Roth IRA.
How do I fill out IRS form 8606 for backdoor Roth?
Part I of form 8606
- Line 1: Enter the nondeductible contribution you made to a traditional IRA in 2020. …
- Line 2: Enter your total basis in Traditional IRAs. …
- Line 3: Add lines 1 & 2 so you would enter $6,000 (or whatever amount you used for your nondeductible contribution).